UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                          -----------------------------

                                   FORM 10 - Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


      January 31, 2000                                             0-11088
------------------------------                             ---------------------
For the quarterly period ended                            Commission file number

                              ALFACELL CORPORATION
                              --------------------
             (Exact name of registrant as specified in its charter)


         Delaware                                                 22-2369085
-------------------------------                              -------------------
(State or other jurisdiction of                                (I.R.S. Employer
 incorporation or organization)                              Identification No.)

               225 Belleville Avenue, Bloomfield, New Jersey 07003
              ----------------------------------------------------
               (Address of principal executive offices) (Zip Code)

(Registrant's telephone number, including area code)              (973) 748-8082
                                                                  --------------

                                 NOT APPLICABLE
                    ----------------------------------------
     (Former name, former address, and former fiscal year, if changed since
                                 last report.)


     Indicate  by check mark  whether the  registrant  has (1) filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest practicable date:

Shares  of Common  Stock,  $.001 par  value  outstanding  as of March 14,  2000:
17,516,559


<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)


PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

                                 BALANCE SHEETS
                       January 31, 2000 and July 31, 1999


<TABLE>
<CAPTION>
                                                 ASSETS
                                                 ------                          January 31,
                                                                                   2000           July 31,
                                                                                (Unaudited)         1999
                                                                             ------------    ------------
<S>                                                                          <C>             <C>
Current assets:
    Cash and cash equivalents                                                $    859,537    $  1,383,133
    Other assets                                                                   88,053         146,708
                                                                             ------------    ------------
        Total current assets                                                      947,590       1,529,841
                                                                             ------------    ------------


Property and equipment, net of accumulated depreciation and amortization
 of $994,263 at January 31, 2000 and $944,830 at July 31, 1999                    149,374         198,807
                                                                             ------------    ------------

          Total assets                                                       $  1,096,964    $  1,728,648
                                                                             ============    ============


                                     LIABILITIES AND STOCKHOLDERS' EQUITY
                                     ------------------------------------

Current liabilities:
    Current portion of long-term debt                                        $      2,604    $      6,727
    Accounts payable                                                               78,825         186,071
    Accrued expenses                                                              774,013         778,650
                                                                             ------------    ------------

        Total current liabilities                                                 855,442         971,448
                                                                             ------------    ------------
Commitments and contingencies

Stockholders' equity:
    Preferred stock, $.001 par value
        Authorized and unissued, 1,000,000 shares at January 31, 2000
          and July 31, 1999                                                          --              --
    Common stock $.001 par value
       Authorized 40,000,000 shares at January 31, 2000 and July 31, 1999;
       Issued and outstanding 17,471,559 shares at January 31, 2000
        and 17,286,594 shares at July 31, 1999                                     17,471          17,286
    Capital in excess of par value                                             55,868,289      55,694,195
    Deficit accumulated during development stage                              (55,644,238)    (54,954,281)
                                                                             ------------    ------------
       Total stockholders' equity                                                 241,522         757,200
                                                                             ------------    ------------
       Total liabilities and stockholders' equity                            $  1,096,964    $  1,728,648
                                                                             ============    ============
</TABLE>

 See accompanying notes to financial statements


                                      -2-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                            STATEMENTS OF OPERATIONS

          Three months and six months ended January 31, 2000 and 1999,
                       and the Period from August 24, 1981
                     (Date of Inception) to January 31, 2000

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                     Three Months Ended                    Six Months Ended        August 24, 1981
                                                         January 31,                           January 31,       (Date of Inception)
                                                                                                                          to
                                                  2000              1999              2000              1999        January 31, 2000
                                               ------------      ------------      ------------      ------------   ----------------

<S>                                            <C>               <C>               <C>               <C>               <C>
REVENUE:
   Sales                                       $       --        $       --        $       --        $       --        $    553,489
   Investment income                                 11,267            47,394            26,220           108,792         1,334,240
   Other income                                        --                --                --                --              60,103
                                               ------------      ------------      ------------      ------------      ------------
   TOTAL REVENUE                                     11,267            47,394            26,220           108,792         1,947,832
                                               ------------      ------------      ------------      ------------      ------------
COSTS AND EXPENSES:
   Cost of sales                                       --                --                --                --             336,495
   Research and development                         592,413           664,989         1,164,321         1,260,193        35,252,950
   General and administrative                       149,590           260,995           305,982           462,563        19,821,042
   Interest:
       Related parties                                 --                --                --                --           1,033,960
       Others                                           839               319             1,728               693         1,903,477
                                               ------------      ------------      ------------      ------------      ------------
TOTAL COSTS AND EXPENSES                            742,842           926,303         1,472,031         1,723,449        58,347,924
                                               ------------      ------------      ------------      ------------      ------------
NET INCOME (LOSS) BEFORE
   STATE TAX BENEFIT                           $   (731,575)     $   (878,909)     $ (1,445,811)     $ (1,614,657)     $(56,400,092)

STATE TAX BENEFIT                                   755,854              --             755,854              --             755,854
                                               ------------      ------------      ------------      ------------      ------------

NET INCOME (LOSS)                              $     24,279      $   (878,909)     $   (689,957)     $ (1,614,657)     $(55,644,238)
                                               ============      ============      ============      ============      ============
   Loss per basic and diluted
       common share                            $        .00      $       (.05)     $       (.04)     $       (.09)     $      (7.10)
                                               ============      ============      ============      ============      ============

Weighted average number of shares
    outstanding                                  17,374,655        17,260,356        17,352,397        17,256,238         7,841,030
                                               ============      ============      ============      ============      ============
</TABLE>

     See accompanying notes to financial statements.


                                      -3-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                            STATEMENTS OF CASH FLOWS

                   Six months ended January 31, 2000 and 1999,
                       and the Period from August 24, 1981
                     (Date of Inception) to January 31, 2000

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                        Six Months Ended           August 24, 1981
                                                                                           January 31,           (Date of Inception)
                                                                                                                           to
                                                                                    2000               1999         January 31, 2000
                                                                               ------------        ------------     ----------------
<S>                                                                            <C>                 <C>                 <C>
Cash flows from operating activities:
  Net Loss                                                                     $   (689,957)       $ (1,614,657)       $(55,644,238)
  Adjustments to reconcile net loss to
    net cash used in operating activities:
   Gain on sale of marketable securities                                               --                  --               (25,963)
   Depreciation and amortization                                                     49,433              50,641           1,373,528
   Loss on disposal of property and equipment                                          --                  --                18,926
   Noncash operating expenses                                                        78,008              94,741           5,450,480
   Amortization of deferred compensation                                               --                  --            11,442,000
   Amortization of organization costs                                                  --                  --                 4,590
Changes in assets and liabilities:
   (Increase) decrease in other current assets                                       58,655             (33,191)            (88,053)
   Decrease in other assets                                                            --                  --                36,184
   Increase in interest payable, related party                                         --                  --               744,539
   Increase (decrease) in accounts payable                                          (15,062)           (448,404)            364,905
   Increase in accrued payroll and expenses, related parties                           --                  --             2,348,145
   Increase (decrease) in accrued expenses                                           (4,637)           (394,623)          1,315,526
                                                                               ------------        ------------        ------------
 Net cash used in operating activities                                             (523,560)         (2,345,493)        (32,659,431)
                                                                               ------------        ------------        ------------
Cash flows from investing activities:
   Purchase of marketable equity securities                                            --                  --              (290,420)
   Proceeds from sale of marketable equity securities                                  --                  --               316,383
   Purchase of property and equipment                                                  --                  --            (1,369,261)
   Patent costs                                                                        --                  --               (97,841)
                                                                               ------------        ------------        ------------

          Net cash used in investing activities                                        --                  --            (1,441,139)
                                                                               ------------        ------------        ------------
</TABLE>

See accompanying notes to financial statements.                      (continued)


                                      -4-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                       STATEMENTS OF CASH FLOWS, Continued

                   Six months ended January 31, 2000 and 1999,
                       and the Period from August 24, 1981
                     (Date of Inception) to January 31, 2000

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                         Six Months Ended          August 24, 1981
                                                                            January 31,          (Date of Inception)
                                                                                                          to
                                                                        2000          1999          January 31, 2000
                                                                      ---------   ------------      ----------------
<S>                                                                   <C>         <C>                   <C>
Cash flows from financing activities:
   Proceeds from short-term borrowings                                $    --     $       --            $    849,500
   Payment of short-term borrowings                                        --             --               (623,500)
   Increase in loans payable - related party, net                          --             --               2,628,868
   Proceeds from bank debt and other long-term debt, net
      of deferred debt costs                                                --             --              2,410,883
   Reduction of bank debt and long-term debt                             (4,123)        (4,476)           (2,922,851)
   Proceeds from issuance of common stock, net                             --             (765)           26,805,447
   Proceeds from exercise of stock options and warrants, net              4,087           --               5,464,760
   Proceeds from issuance of convertible debentures                        --             --                 347,000
                                                                      ---------   ------------          ------------

      Net cash provided (used) by financing activities                      (36)        (5,241)           34,960,107
                                                                      ---------   ------------          ------------
      Net increase (decrease) in cash and cash equivalents             (523,596)    (2,350,734)              859,537
 Cash and cash equivalents at beginning of period                     1,383,133      5,099,453                  --
                                                                      ---------   ------------          ------------
 Cash and cash equivalents at end of period                           $ 859,537   $  2,748,719          $    859,537
                                                                      =========   ============          ============
 Supplemental disclosure of cash flow information -
    interest paid                                                     $   1,728   $        693          $  1,650,461
                                                                      =========   ============          ============
 Noncash financing activities:
    Issuance of convertible subordinated
      debenture for loan payable to officer                           $    --     $       --            $  2,725,000
                                                                      =========   ============          ============
    Issuance of common stock upon the conversion of
      convertible subordinated debentures, related party              $    --     $       --            $  2,945,000
                                                                      =========   ============          ============
    Conversion of short-term borrowings to common stock               $    --     $       --            $    226,000
                                                                      =========   ============          ============
    Conversion of accrued interest, payroll and expenses by
      related parties to stock options                                $    --     $       --            $  3,194,969
                                                                      =========   ============          ============
    Repurchase of stock options from related party                    $    --     $       --            $   (198,417)
                                                                      =========   ============          ============
    Conversion of accrued interest to stock options                   $    --     $       --            $    142,441
                                                                      =========   ============          ============
    Conversion of accounts payable to common stock                    $  92,184   $     16,631          $    286,170
                                                                      =========   ============          ============
    Conversion of notes payable, bank and accrued interest to
          long-term debt                                              $    --     $       --            $  1,699,072
                                                                      =========   ============          ============
    Conversion of loans and interest payable, related party
          and accrued payroll and expenses, related parties to
          long-term accrued payroll and other, related party          $    --     $       --            $  1,863,514
                                                                      =========   ============          ============
    Issuance of common stock upon the conversion of
       convertible subordinated debentures, other                     $    --     $       --            $    127,000
                                                                      =========   ============          ============
    Issuance of common stock for services rendered                    $    --     $       --            $      2,460
                                                                      =========   ============          ============
</TABLE>

     See accompanying notes to financial statements.


                                      -5-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                                   (Unaudited)


1.   ORGANIZATION AND BASIS OF PRESENTATION

     In  the  opinion  of  management,   the  accompanying  unaudited  financial
statements  contain all adjustments  (consisting of normal  recurring  accruals)
necessary to present fairly the Company's  financial  position as of January 31,
2000 and the results of  operations  for the three and six month  periods  ended
January  31,  2000  and  1999 and the  period  from  August  24,  1981  (date of
inception)  to January 31, 2000.  The results of  operations  for the six months
ended  January  31,  2000 are not  necessarily  indicative  of the results to be
expected for the full year.

     The  Company is a  development  stage  company as defined in the  Financial
Accounting  Standards Board's Statement of Financial Accounting Standards No. 7.
The Company is devoting substantially all of its present efforts to establishing
a new  business.  Its  planned  principal  operations  have not  commenced  and,
accordingly, no significant revenue has been derived therefrom.

     Effective  August 1, 1998,  the  Company  adopted  Statement  of  Financial
Accounting Standards No. 130 ("SFAS 130"), Reporting  Comprehensive Income. SFAS
130 establishes new rules for the reporting and display of comprehensive  income
and its components.  The net loss of $690,000 and  $1,615,000,  recorded for the
six  months  ended  January  31,  2000 and 1999,  respectively,  is equal to the
comprehensive loss for those periods.

     The Company has reported net losses since its inception.  Also, the Company
has limited liquid resources.  The report of the Company's  independent auditors
on the Company's  July 31, 1999  financial  statements  included an  explanatory
paragraph  which states that the Company's  recurring  losses and limited liquid
resources raise  substantial  doubt about the Company's ability to continue as a
going concern.  The financial statements at July 31, 1999 or January 31, 2000 do
not  include  any  adjustments  that  might  result  from  the  outcome  of this
uncertainty.

2.   EARNINGS PER COMMON SHARE

     "Basic"  earnings  (loss) per common share equals net income (loss) divided
by weighted  average  common  shares  outstanding  during the period.  "Diluted"
earnings  (loss)  per  common  share  equals  net  income  divided by the sum of
weighted average common shares  outstanding  during the period plus common stock
equivalents. The Company's Basic and Diluted per share


                                      -6-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS, continued

                                   (Unaudited)


2.   EARNINGS PER COMMON SHARE, continued

amounts are the same since the assumed  exercise of stock  options and  warrants
are all  anti-dilutive.  The amount of options and  warrants  excluded  from the
calculation   was  5,862,965  and  6,083,679  at  January  31,  2000  and  1999,
respectively.

3.   CAPITAL STOCK

     In August  1999,  the  Company  issued  40,000  shares of common  stock for
payment of services  rendered.  The fair value of the common stock in the amount
of $18,400 was charged to operations.

     In September  1999,  the Company  issued  14,600 shares of common stock for
payment of legal  services.  The fair value of the common stock in the amount of
$8,176 was charged to operations.

     In December  1999,  the Company  issued an aggregate  total of 75,000 stock
options to its outside board of directors.

     In January  2000,  the Company  issued  120,365  shares of common stock for
payment of services  rendered.  The fair value of the common stock in the amount
of $65,608 was charged to operations.

     In January 2000,  the Company issued 10,000 shares of common stock upon the
exercise of stock options by an unrelated  party  resulting in gross proceeds of
$4,300 to the Company.

4.   SALE OF NET OPERATING LOSSES

     New  Jersey  has  enacted   legislation   permitting   certain  New  Jersey
corporations to sell state tax loss  carryforwards  and research and development
credits (the "Tax  Benefits").  Approximately  $2.4 million of the Company's Tax
Benefits were approved for sale by the state, of which  approximately $1 million
was allocated to be sold for the State Fiscal Year 2000 (July 1, 1999 to


                                      -7-
<PAGE>


                              ALFACELL CORPORATION
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS, continued

                                   (Unaudited)


4.   SALE OF NET OPERATING LOSSES, continued

June 30, 2000). In December 1999, the Company  realized net proceeds of $755,854
from the sale of its allocated  Tax  Benefits.  The Company will attempt to sell
the remaining  balance of its Tax Benefits in the amount of  approximately  $1.4
million for the State Fiscal Year 2001 (July 1, 2000 to June 30, 2001),  subject
to all existing laws of the State of New Jersey.

5.   SUBSEQUENT EVENT

     In February 2000, the Company sold an aggregate of 875,000 shares of common
stock to  private  investors  at prices  ranging  from  $0.50 to $1.00 per share
resulting in net proceeds of $625,000 to the Company.  In addition,  the private
investors  were granted  warrants to purchase an aggregate of 687,500  shares of
common  stock at per share  exercise  prices  ranging  from $1.03 to $3.25.  The
warrants  will expire  during the period  commencing  May 2003 and ending in May
2005.













                                      -8-
<PAGE>


Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations

     Information  contained herein contains  "forward-looking  statements" which
can be identified by the use of forward-looking  terminology such as "believes",
"expects",  "may", "will", "should", or "anticipates" or the negative thereof or
other  variations  thereon  or  comparable  terminology,  or by  discussions  of
strategy.  No  assurance  can be given  that the future  results  covered by the
forward-looking  statements  will be achieved.  The matters set forth in Exhibit
99.1 to the Company's  Annual Report on Form 10-K for the fiscal year ended July
31, 1999,  which is  incorporated  herein by  reference,  constitute  cautionary
statements  identifying  important factors with respect to such  forward-looking
statements,  including certain risks and uncertainties,  that could cause actual
results  to  vary  materially   from  the  future  results   indicated  in  such
forward-looking  statements.  Other factors  could also cause actual  results to
vary  materially  from the  future  results  indicated  in such  forward-looking
statements.

Results of Operations

Three and six month periods ended January 31, 2000 and 1999

     Revenues.  The  Company is a  development  stage  company as defined in the
Financial   Accounting  Standards  Board's  Statement  of  Financial  Accounting
Standards  No. 7. As such,  the  Company is  devoting  substantially  all of its
present efforts to establishing a new business and developing new drug products.
The Company's planned principal  operations of marketing and/or licensing of new
drugs have not  commenced  and,  accordingly,  no  significant  revenue has been
derived  therefrom.  The Company  focuses most of its  productive  and financial
resources  on the  development  of ONCONASE and as such has not had any sales in
the six months ended  January 31, 2000 and 1999.  Investment  income for the six
months  ended  January 31, 2000 was  $26,000  compared to $109,000  for the same
period last year, a decrease of $83,000. This decrease was due to lower balances
of cash and cash equivalents.

     Research and  Development.  Research and development  expense for the three
months  ended  January 31, 2000 was  $592,000  compared to $665,000 for the same
period last year, a decrease of $73,000 or 11%.  This decrease was primarily due
to a 38% decrease in costs in support of on-going clinical trials, primarily due
to the completion of the patient  enrollment of the Phase III clinical trial for
malignant  mesothelioma,  a 94%  decrease  in costs  related to the  preclinical
research  studies  of  ONCONASE,  primarily  due to the  extension  of the CRADA
agreement  with the NCI without cost to the Company and an 80% decrease in costs
associated  with  the  manufacture  of  clinical  supplies  of  ONCONASE.  These
decreases  were offset by an increase  in expenses in  preparation  of a Pre-NDA
meeting with the FDA and an 18% increase in rent expenses.

     Research and development  expense for the six months ended January 31, 2000
was $1,164,000  compared to $1,260,000 for the same period last year, a decrease
of $96,000 or 8%. This  decrease was primarily due to a 42% decrease in costs in
support of on-going  clinical  trials,  primarily  due to the  completion of the
patient enrollment of the Phase III clinical trial for


                                      -9-
<PAGE>


malignant  mesothelioma,  an 87%  decrease in costs  related to the  preclinical
research  studies  of  ONCONASE,  primarily  due to the  extension  of the CRADA
agreement with the NCI without cost to the Company,  and a 42% decrease in costs
associated  with  the  manufacture  of  clinical  supplies  of  ONCONASE.  These
decreases  were offset by an increase  in expenses in  preparation  of a Pre-NDA
meeting with the FDA and a 19% increase in rent expenses.

     General  and  Administrative.  General and  administrative  expense for the
three  months ended  January 31, 2000 was $150,000  compared to $261,000 for the
same  period  last year,  a decrease  of  $111,000  or 43%.  This  decrease  was
primarily due to an 85% decrease in public relations  expenses,  a 46% reduction
in administrative  personnel costs and a 62% decrease in consulting fees, offset
by a 20% increase in rent expenses.

     General and  administrative  expense for the six months  ended  January 31,
2000 was $306,000 compared to $463,000 for the same period last year, a decrease
of $157,000 or 34%.  This  decrease  was  primarily  due to a 45%  reduction  in
administrative personnel costs, an 82% decrease in public relations expenses and
a 29% decrease in  consulting  fees,  offset by a 63% increase in legal fees and
20% increase in rent expenses.

     Income Taxes.  New Jersey has enacted  legislation  permitting  certain New
Jersey  corporations  to sell  state tax loss  carryforwards  and  research  and
development  credits  (the "Tax  Benefits").  Approximately  $2.4 million of the
Company's  Tax  Benefits  were  approved  for  sale  by  the  state,   of  which
approximately $1 million was allocated to be sold for the State Fiscal Year 2000
(July 1, 1999 to June 30,  2000).  In December  1999,  the Company  realized net
proceeds of $755,854 from the sale of its  allocated  Tax Benefits.  The Company
will attempt to sell the remaining  balance of its Tax Benefits in the amount of
approximately  $1.4 million for the State Fiscal Year 2001 (July 1, 2000 to June
30, 2001), subject to all existing laws of the State of New Jersey.

     Net Income  (Loss).  The Company has incurred  net losses  during each year
since its inception.  The net income for the three months ended January 31, 2000
was $24,000 as compared to a net loss of $879,000 for the same period last year,
an increase of $903,000.  The net income for the three months ended  January 31,
2000 was  primarily due to the result of the sale of the Company's Tax Benefits.
The net loss for the six months ended  January 31, 2000 was $690,000 as compared
to  $1,615,000  for the same  period  last year,  a decrease of $925,000 or 57%,
primarily  due to the  result of the sale of the  Company's  Tax  Benefits.  The
cumulative loss from the date of inception, August 24, 1981 to January 31, 2000,
amounted  to  $55,644,000.  Such  losses are  attributable  to the fact that the
Company  is still in the  development  stage  and  accordingly  has not  derived
sufficient revenues from operations to offset the development stage expenses.


                                      -10-
<PAGE>


Liquidity and Capital Resources

     Alfacell has financed its  operations  since  inception  primarily  through
equity and debt financing,  research product sales and interest  income.  During
the six months ended  January 31,  2000,  the Company had a net decrease in cash
and cash equivalents of $523,000, which resulted primarily from net cash used in
operating activities.  Total cash resources as of January 31, 2000 were $860,000
compared to $1,383,000 at July 31, 1999.

     The  Company's  current  liabilities  as of January 31, 2000 were  $855,000
compared  to  $971,000 at July 31,  1999,  a decrease  of  $116,000 or 12%.  The
decrease  was  primarily  due to the  issuance  of common  stock in payment  for
services rendered and a decrease in costs in support of on-going clinical trials
for ONCONASE,  primarily due to the completion of the patient  enrollment of the
Phase III clinical trial for malignant mesothelioma.

     In February 2000, the Company sold an aggregate of 875,000 shares of common
stock to  private  investors  at prices  ranging  from  $0.50 to $1.00 per share
resulting in net proceeds of $625,000 to the Company.  In addition,  the private
investors  were granted  warrants to purchase an aggregate of 687,500  shares of
common  stock at per share  exercise  prices  ranging  from $1.03 to $3.25.  The
warrants  will expire  during the period  commencing  May 2003 and ending in May
2005.

     Until the Company's operations generate significant revenues, cash reserves
will  continue  to fund  operations.  To  date,  a  significant  portion  of the
Company's  financing  has been through  private  placements  of common stock and
warrants,  the issuance of common stock for stock options exercised and services
rendered, debt financing and financing provided by the Company's Chief Executive
Officer.  The Company  believes that its cash and cash equivalents as of January
31, 2000 will be  sufficient  to meet its  anticipated  cash needs  through July
2000,  after taking into account the  approximately  $650,000 in gross  proceeds
received from the private  placement of common stock and warrants,  and exercise
of stock  options in  February  2000.  The report of the  Company's  independent
auditors  on the  Company's  July 31,  1999  financial  statements  included  an
explanatory  paragraph  which  states that the  Company's  recurring  losses and
limited liquid resources raise  substantial doubt about the Company's ability to
continue  as a going  concern.  The  financial  statements  at July 31,  1999 or
January  31,  2000 do not include  any  adjustments  that might  result from the
outcome of this uncertainty.

     The  Company's  continued  operations  will  depend on its ability to raise
additional  funds  through  various  potential  sources  such as equity and debt
financing,  collaborative  agreements,  strategic  alliances,  sale of tax  loss
carryforwards  and research and  development  tax credits and revenues  from the
commercial  sale of  ONCONASE.  There can be no assurance  that such  additional
funds will become  available.  The Company is in the  process of  analyzing  the
Phase III data of its clinical trial for unresectable  malignant mesothelioma in
preparation  for a Pre-NDA meeting with the FDA and will continue to incur costs
in conjunction  with such meeting.  The Company is currently in discussion  with
several potential strategic alliance partners for further


                                      -11-
<PAGE>


development  and  marketing of ONCONASE and the other  potential new products in
the  Company's  pipeline.  However,  there  can be no  assurance  that  any such
alliances  will  materialize.  The  ability of the  Company to raise  additional
capital  through the sale of its  securities  will primarily be dependent on the
outcome of the Phase III clinical trial for unresectable malignant mesothelioma.
However,  the ability to raise funding at that time may be dependent  upon other
factors including without  limitation,  market  conditions,  and there can be no
assurance that such funds will be available.

     New  Jersey  has  enacted   legislation   permitting   certain  New  Jersey
corporations to sell state tax loss  carryforwards  and research and development
credits (the "Tax  Benefits").  Approximately  $2.4 million of the Company's Tax
Benefits were approved for sale by the state, of which  approximately $1 million
was  allocated  to be sold for the State  Fiscal Year 2000 (July 1, 1999 to June
30, 2000). In December 1999, the Company  realized net proceeds of $755,854 from
the sale of its  allocated  Tax  Benefits.  The Company will attempt to sell the
remaining  balance  of its Tax  Benefits  in the  amount of  approximately  $1.4
million for the State Fiscal Year 2001 (July 1, 2000 to June 30, 2001),  subject
to all existing laws of the State of New Jersey.

     The  Company's  Common Stock was delisted from The Nasdaq  SmallCap  Market
effective  at the close of  business  April  27,  1999 for  failing  to meet the
minimum bid price  requirements set forth in the NASD  Marketplace  Rules. As of
April 28, 1999, the Company's  Common Stock was traded on the OTC Bulletin Board
under the symbol  "ACEL".  Delisting of the Company's  Common Stock from Nasdaq,
could have a material  adverse  effect on the Company  including  its ability to
raise  additional  capital,  its  stockholders=  liquidity  and the price of the
Company's Common Stock.

     The market price of the Company's  common stock is volatile,  and the price
of the stock could be  dramatically  affected  one way or another  depending  on
numerous  factors.  The market price of the Company's common stock could also be
materially  affected  by the  results  of  the  Phase  III  clinical  trial  for
unresectable malignant mesothelioma.

Year 2000 Impact

     The Company has completed its year 2000 compliance without any interruption
to its  business  operations.  To date,  the  Company  has not  encountered  any
unforseen   year  2000  problems.   The  Company   estimates  that  it  incurred
approximately  $20,000  of costs  related  to its year  2000  compliance.  It is
possible  that the Company may  encounter  problems  with vendors and  suppliers
which could  adversely  affect the  Company's  financial  condition,  results of
operations or cash flow,  although the Company is not aware of such instances to
date. The Company cannot accurately predict the occurrence and or outcome of any
such problems in the future, nor can the cost of such problems be estimated.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

        Not applicable.


                                      -12-
<PAGE>


PART II. OTHER INFORMATION

Item 2. (c) Recent Sales of Unregistered Securities

     In January  2000,  the Company  issued  120,365  shares of Common Stock for
payment of services  rendered in a private  transaction  effected in  accordance
with the exemption from the  registration  requirements of the Securities Act of
1933,  as amended  (the  "Securities  Act")  contained  in  Section  4(2) of the
Securities Act.

Item 5. Other Information

     In February 2000, the Company sold an aggregate of 875,000 shares of common
stock to  private  investors  at prices  ranging  from  $0.50 to $1.00 per share
resulting in net proceeds of $625,000 to the Company.  In addition,  the private
investors  were granted  warrants to purchase an aggregate of 687,500  shares of
common  stock at per share  exercise  prices  ranging  from $1.03 to $3.25.  The
warrants  will expire  during the period  commencing  May 2003 and ending in May
2005.

     Because  the  Company's  common  stock is no longer  listed  on The  Nasdaq
SmallCap  Market,  the  Company  is  no  longer  eligible  to  use  a  Form  S-3
registration  statement to register its shares under the Securities Act of 1933.
As a result,  in February 2000, the Company filed a post-effective  amendment to
two Form S-3  registration  statements  it had on file with the SEC  withdrawing
such  registration   statements.   These  registration   statements   originally
registered the resale of approximately  7,652,840 shares of the Company's common
stock by certain of the Company's  stockholders.  The Company  intends to file a
new  registration  statement  on Form S-1 to  register  such  shares in the near
future.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits (numbered in accordance with Item 601 of Regulation S-K).

<TABLE>
<CAPTION>
                                                                                           Exhibit No. or
Exhibit                                                                                    Incorporation
 No.                                       Item Title                                       by Reference
 ---                                       ----------                                       ------------

<S>                                                                                           <C>
 3.1  Certificate of Incorporation                                                                *
 3.2  By-Laws                                                                                     *
 3.3  Amendment to Certificate of Incorporation                                                   #
 3.4  Amendment to Certificate of Incorporation                                                 +++
 4.1  Form of Convertible Debenture                                                              **
10.1  Form of Stock and Warrant Purchase Agreements used in private
      placements completed April 1996 and June 1996                                              ##
</TABLE>


                                      -13-
<PAGE>


<TABLE>
<CAPTION>
                                                                                           Exhibit No. or
Exhibit                                                                                    Incorporation
 No.                                       Item Title                                       by Reference
 ---                                       ----------                                       ------------

<S>                                                                                           <C>
10.2  Lease Agreement - 225 Belleville Avenue, Bloomfield, New Jersey                           ###
10.3  Form of Stock Purchase Agreement and Certificate used in
      connection with various private placements                                                ***
10.4  Form of Stock and Warrant Purchase Agreement and Warrant
      Agreement used in Private Placement completed on March 21, 1994                           ***
10.5  The Company's 1993 Stock Option Plan and Form of Option Agreement                       *****
10.6  Debt Conversion Agreement dated March 30, 1994 with Kuslima Shogen                       ****
10.7  Accrued Salary Conversion Agreement dated March 30, 1994 with Kuslima
      Shogen                                                                                   ****
10.8  Accrued Salary Conversion Agreement dated March 30, 1994 with
      Stanislaw Mikulski                                                                       ****
10.9  Debt Conversion Agreement dated March 30, 1994 with John Schierloh                       ****
10.10 Option Agreement dated March 30, 1994 with Kuslima Shogen                                ****
10.11 Option Agreement dated March 30, 1994 with Kuslima Shogen                                ****
10.12 Amendment No. 1 dated June 20, 1994 to Option Agreement dated March 30, 1994
      with Kuslima Shogen                                                                      ****
10.13 Form of Amendment No. 1 dated June 20, 1994 to Option Agreement dated March
      30, 1994 with Kuslima Shogen                                                            *****
10.14 Form of Amendment No. 1 dated June 20, 1994 to Option Agreement dated March
      30, 1994 with Stanislaw Mikulski                                                        *****
10.15 Form  of  Stock  and  Warrant  Purchase   Agreement  and  Warrant
      Agreement  used in Private  Placement  completed on September 13,
      1994                                                                                        +
10.16 Form of Subscription Agreements and Warrant Agreement used in Private
      Placements closed in October 1994 and September 1995                                        #
10.17 1997 Stock Option Plan                                                                    ###
10.18 Separation Agreement with Michael C. Lowe dated as of
      October 9, 1997                                                                            ++
10.19 Form of Subscription Agreement and Warrant Agreement used
      in Private Placement completed on February 20, 1998                                       +++
</TABLE>


                                      -14-
<PAGE>


<TABLE>
<CAPTION>
                                                                                          Exhibit No. or
Exhibit                                                                                    Incorporation
 No.                                       Item Title                                       by Reference
 ---                                       ----------                                       ------------

<S>   <C>                                                                                     <C>
10.20 Form of Warrant Agreement issued to the Placement Agent in connection with the            +++
      Private Placement completed on February 20, 1998

10.21 Placement Agent Agreement dated December 15, 1997                                         +++

 27.1 Financial Data Schedule                                                                 #####

 99.1 Factors to Consider in Connection with Forward-Looking Statements                        ####
      Previously filed as exhibit to the Company's Registration Statement on Form S-18 (File
      No. 2-79975-NY) and incorporated herein by reference thereto.

      Previously filed as exhibits to the Company's Annual Report on Form 10-K for the year
      ended July 31, 1993 and incorporated herein by reference thereto.

***   Previously filed as exhibits to the Company's Quarterly Report on Form 10-QSB for
      the quarter ended January 31, 1994 and incorporated herein by reference thereto.

****  Previously filed as exhibits to the Company's Quarterly Report on Form 10-QSB for
      the quarter ended April 30, 1994 and incorporated herein by reference thereto.

***** Previously  filed as exhibits to the Company's Registration Statement Form SB-2 (File No.
      33-76950) and incorporated herein by reference thereto.

+     Previously filed as exhibits to the Company's Registration Statement on Form SB-2 (File No.
      33-83072) and incorporated herein by reference thereto.

++    Previously filed as exhibits to the Company's Quarterly Report on Form 10-Q for
      the quarter ended October 31, 1997 and incorporated herein by reference thereto.

+++   Previously filed as exhibits to the Company's Quarterly Report on Form 10-Q for
      the quarter ended January 31, 1998 and incorporated herein by reference thereto.

#     Previously filed as exhibits to the Company's Annual Report on Form 10-KSB for
      the year ended July 31, 1995 and incorporated herein by reference thereto.

##    Previously filed as exhibits to the Company's Registration Statement on Form SB-2
      (File No. 333-11575) and incorporated herein by reference thereto.

###   Previously filed as exhibits to the Company's Quarterly Report on Form 10-QSB
</TABLE>


                                      -15-
<PAGE>

<TABLE>
<CAPTION>

      for the quarter ended April 30, 1997 and incorporated herein by reference thereto.

<S>   <C>
####  Previously filed as exhibits to the Company's Annual Report on Form 10-K for the year
      ended July 31, 1999 and  incorporated herein by reference thereto.

##### Filed herewith.
</TABLE>

(b)   Reports on Form 8-K.

      None.













                                      -16-
<PAGE>


                                   SIGNATURES


     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                                      ALFACELL CORPORATION
                                                      --------------------
                                                           (Registrant)


March 15, 2000                                        /s/ KUSLIMA SHOGEN
                                                      ------------------
                                                      Kuslima Shogen, Chief
                                                      Executive Officer, Acting
                                                      Chief Financial Officer
                                                      (Principal Executive
                                                      Officer,  Principal
                                                      Accounting Officer) and
                                                      Chairman of the Board









                                      -17-